The ferrous complex lifted aggressively yesterday as green restrictions on steel output rocket prices higher. Iron ore had a better day but China aims for it to be the charred remain left behind. Will it succeed?
Morgan Stanley tackles the question:
Summary view: China’s steel production cuts are positive for global steel prices, but will pile pressure on the still elevated iron ore price. Our forecast implies downside to forward iron ore prices. We expect high-grade 65% Fe ore to outperform lower quality ore. Strong ex-China steel production should push met-coal higher.